15. George has four employees who earned $75,000, $27,000, $2,100, and $6,200 du

Question

15. George has four employees who earned $75,000, $27,000, $2,100, and $6,200 during 2016, respectively. He paid 5.4 percent for state unemployment tax. How much FUTA tax will George owe for the four employees? A. $882.40 B. $133.80 C. $321.60 D. $224.00 E. $163.70 15. George has four employees who earned $75,000, $27,000, $2,100, and $6,200 during 2016, respectively. He paid 5.4 percent for state unemployment tax. How much FUTA tax will George owe for the four employees? A. $882.40 B. $133.80 C. $321.60 D. $224.00 E. $163.70 A. $882.40 B. $133.80 C. $321.60 D. $224.00 E. $163.70

Explanation / Answer

ANSWER= B) $133.80

FUTA Tax rate = 6%

less- Credit of SUTA Tax Rate

FUTA Tax rate = 6%-5.4%

FUTA Tax rate = 0.6%

The federal wage base = 7000

The tax applies to the first $7,000 pay to each employee as wages during the year.

$75000 = $7000 *0.6% = 42

$27000 = $7000 * 0.6% = 42

$2100 = $2100 * 0.6% = 12.6

$6200 = $6200 * 0.6% = 37.2

FUTA tax will George owe for the four employees = 42+42+12.6+37.2 = $ 133.80

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